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Contract Management Promotes Business Growth

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Congratulations Freelancer colleague, as summer ends and the fourth quarter approaches, you’ve landed a client and have been asked to sign a contract. You are well aware that receiving a contract is the road to revenue but that’s only part of its power. When a contract and the arc of its lifecycle are recognized and utilized, you can initiate a mutually agreeable working relationship with your client and make the possibility of repeat business amenable to the client.

To the best of your ability you, Freelancer friend, should ensure that all contracts you sign advance and protect your interests, as well as the client’s. Keep at top-of-mind that expectations are foundational to contracts. A well-written contract defines and describes what the client expects of you—primarily, to produce the desired outcome or deliverable that also meets the client’s quality control standard and is completed and available by a specified date.

At its core, a contract is a commitment whose purpose is to guarantee that client expectations and your responsibilities are defined and achieved. When you think about it, a contract is potentially more than a method to certify a working agreement. In particular, contracts that pertain to B2B services or products can be considered strategic tools that provide risk management for both you and the client, in addition to revenue generation for you.

Contract management is the process of creating an official document that identifies client expectations and defines the responsibilities of the party that produces the outcome or deliverable and meets the deadlines. Contract management also includes the discussion and negotiation of factors such as payment for work performed and contingencies that, when agreement is reached, are written into the document. Contract management is considered completed after the outcome or deliverable are produced and the document is reviewed and analyzed to assess the execution of the work performed against the terms of the contract. This final step of contract management is of particular interest to B2B service providers, whether the deliverable is a one-off project or an ongoing subscription, as it may reveal where and how you could have utilized your company’s operational processes more efficiently to reduce monetary expenses or time associated with producing the deliverable.

A written agreement

Contracts typically begin with discussion and a verbal agreement, but that process should be viewed as only the first step of new client engagement. It is in the interest of both parties to commit all major business agreements to writing by creating a contract after first discussing client goals and expectations, timeline and budget to attain understanding and mutual agreement and then following-up with the development of a written document that will be signed by the parties involved.

The author of the contract will depend on the client. Corporate and not-for-profit organizations typically have a standard contract that is used for Freelance talent. Small businesses and organizations that engage with few Freelancers may be happy to allow you to author the document. Over time, many Freelancers develop a standard B2B professional services contract template; however, it will be worth your while to investigate contract templates that can streamline and speed up the contract management process, from creating the document, to negotiating terms and facilitating online docu-signing. You will find contract management software available on several platforms.

Regardless of its author, know that you owe it to yourself to carefully review all contracts that you intend to sign, to ensure that both signers will be able to meet the terms. Put questions and answers in writing (email), to provide documentation. When you are not the contract author, diplomatically suggest that you and the prospective client collaborate and negotiate when you find it necessary, to ensure that you can fulfill your responsibilities and please the client. All changes to the agreement should be in the form of written amendments, or at a minimum, an email that documents the changes.

Finally, caveat emptor—a contract is only as good as your ability to enforce it. A written agreement is nearly always useful, but if one of the parties fails to fulfill the agreed-upon terms, the other will be stuck. Even a contract written to anticipate nearly every contingency is only as good as the behavior of the signers. Integrity and trust matter and maintaining complete records is a must.

  • Document changes: If changes are made to the original contract, write them down. Make sure everyone signs off on all changes and attach amendments and signatory approval to the original agreement.
  • Keep original copies: Keep signed copies of all contracts safe and organized, whether they are in hard copy or digital format.
  • Track communications: Keep a record that includes notes and the dates of all contract discussions. This includes emails, letters, meeting notes and phone logs.

Payments

Let your contract specify when, how much and by what payment method you’ll be paid. While W-2 employees receive regular weekly or bi-weekly paychecks, that is not the scenario for Freelance consulting talent. At some organizations, we are the last to get paid and late, sometimes scandalously late, payments can be distressingly common.

Defend yourself by making it clear to the client that you expect to be paid according to the timeline that was discussed and agreed upon. In fact, once you and the client have committed to the amount of your project fee and scheduled the initial payment that you require before commencing work, as well as the milestone or other interim payments, if applicable, plus the timing of the final project payment, be certain to specify the amount and schedule of those payments in the contract. Furthermore, you might also note that all payment amounts and associated dates are non-negotiable. Trust is central to every contract and committing the agreement to writing encourages trustworthy behavior.

Along with a dispute resolution clause in your agreement, also specify how you will handle non-payment. You shouldn’t be expected to continue work if you aren’t getting paid but collecting unpaid debt can be a real challenge. Include a clause about debt collection, either through an agency or a lawyer— and that cost should be on the client, not on you.

Client expectations

Before you enter into a working agreement, you and your client must have similar expectations of one another’s roles. Assume nothing and in particular, ask questions to confirm the project deliverables and timeline—milestones and deadline. Ask also for your client’s description of a successfully achieved milestone and a successfully completed project.

In a Freelance B2B contract for professional services rendered, outline what you agree to do and how it will be done. There must be no ambiguity about the desired outcome or deliverable, or the quality of the work that the client expects. It’s also helpful to make clear what happens if you do not meet the agreed-upon deliverable deadline; usually, it means some portion of your payment is withheld until both parties are satisfied with the progress of the project.

Ensure that the client knows the full spectrum of services you’ll provide to satisfactorily produce the outcome or deliverable and the amount of time you expect will be needed. If there are complicated elements to the project, make sure the client comprehends what is needed to achieve the that vision.

Milestones

Milestones are essential for independent projects, as well as for organizations that hire Freelance talent. By detailing a project’s milestones, you can ensure that you and the client know when to expect key deliverables. If no milestones have been discussed and agreed upon before your hire, you might raise the issue yourself, in order to keep your client apprised of the project’s progress and document your intention and ability to satisfactorily complete all work by the deadline.

Intellectual property

If the assignment you’re hired to complete involves intellectual property of some sort, the contract should describe and define who owns what. Do you exclusively own the intellectual property, or does your client have some rights to it? Be sure that you understand precisely what you’re handing over and what rights you retain to make sure that you identify which party owns what rights and royalties for each product or service made available. It’s a good idea for both parties involved to have their IP attorney review a Freelance contract before signing on. The last thing either of you wants is a misunderstanding over ownership to break out after a project has been completed, especially if a significant amount of money is at stake.

Confidentiality

It is assumed that you will not share any information about your client’s business without written consent. You may be asked to sign a Non Disclosure Agreement and if so, maintain a copy in your records, along with the contract.

Confidentiality includes financial data, proprietary information and other protected details. There should be a clause that prohibits you from releasing any of your client’s personal information without permission. If you feel it necessary to disclose confidential or protected information for legal reasons, make sure that you obtain your client’s explicit permission before doing so.

Support and resources supplied by the client

Identify your client contact either in the contract or in an email and confirm that person’s availability to you and the type of support that will be provided. If on-site access to company resources, equipment, or materials is needed to execute the work you are hired to do, specify in writing what you’ll need to use and document your intention to return it and to whom it will be returned when your work is completed.

An out clause

It can be frustrating if you’ve been led to believe that signing a new client is imminent, only to have the agreement unexpectedly fall apart. In the Freelancing universe, it’s anticipated that some projects might end prematurely, whether the result of an unexpected hire of a W-2 employee or a sudden funding loss. Alternatively, you may face a health crisis or family emergency that will make it extremely difficult to fulfill the contract and forces you to terminate the agreement.

Regardless of the determining factors, a termination for convenience clause allows either party to unilaterally end a B2B contract without cause and without engaging in litigation. The client can simply provide notice that s/he must end the agreement and pay you for any work that’s been done, or you can inform the client in writing, in accordance to a predetermined specific termination notice period (14 to 30 days is common), and agree to certain post-termination obligations.

 Effective communication will be critical to soften negative perceptions and sustain future collaboration. A transparent explanation of the reason for termination is essential to preserving credibility and trust.

Next steps

Once the contract is signed, be certain to send your new client a welcome letter and schedule a face2face or videoconference meeting to begin onboarding and officially inaugurate your new client engagement!

Thanks for reading,

Kim

Image: Treaty of Paris, More Than Meets the Eye, 1783 (Benjamin West, 1738-1820) courtesy of The Winterthur Museum, Garden and Library, Winterthur, DE. The treaty officially ended the American Revolutionary War (1775-1783) and marked England’s acknowledgement of the U.S. as an independent sovereign entity with defined borders.

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Brand Building: Deliver the Promise

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Can we agree that data driven decisions produce the most favorable outcomes? The mega database of customer info compiled by the World Advertising Research Centre of New York City, USA and London, UK has since 1985 provided powerful information to business leaders and enabled them to develop marketing strategies and campaigns that attract the attention prospective customers and persuade them to try a product or service or persuade existing customers to become frequent users, meaning repeat customers, of a product or service. WARC data points to a product’s brand promise as the definitive ingredient of successful marketing and brand-building campaigns. The right brand promise, one that target customers perceive as memorable, valuable and deliverable, has the power to influence the purchasing behavior of your target customers and convert them to buyers. WARC data also indicates that a well-crafted brand promise not only translates into purchases and sales revenue, but also provides a blueprint that can be used to devise successful marketing strategies and campaigns.

In other words, the key to successful brand-building is a clear and specific brand promise that target customers feel can be fulfilled. Such a brand promise has been shown to result in marketing campaigns that positively impact sales revenue and also help to shape effective marketing strategies and campaigns.

Commit to the brand promise

WARC research shows that brand promises that target customers trust and believe will be delivered result in sales of the product or service. Roger L. Martin, a former dean of the Rotman School of Management at the University of Toronto (Canada) and author of A New Way to Think (2022); Jann Martin Schwartz, founder and Senior Global Director at the LinkedIn B2B Institute and Mimi Turner, head of Europe, Middle East, Africa and Latin America operations at the LinkedIn B2B Institute teamed up to more closely examine the question of effective marketing—how can business owners and leaders make it happen?

Martin, Turner and Schwartz sought to understand the active ingredients, if you will, of a marketing campaign—what makes it successful? The team recognized the potential appeal of the brand promise and they began by classifying WARC marketing campaign data according to whether or not a verifiable brand promise was made to customers. They found that of 2,021 campaigns analyzed, 40% (808) included an obvious brand promise and 60% (1,213) did not.

The first noteworthy finding of their research was campaigns that included a verified brand promise were more persuasive than campaigns with no brand promise in nearly every instance. In measures of brand perception, brand preference and purchase intent, 56% of campaigns offering a brand promise reported improvement. Market penetration increased in 45% of brand promise campaigns and market share increased in 27% of brand promise campaigns. The only metric in which a brand promise did not triumph was in generating social media buzz, where 55% of successful marketing campaigns omitted a brand promise.

Anatomy of a brand promise

As noted above, Turner, Schwartz and Martin started out by confirming the presence of a brand promise the the marketing campaigns; next, they categorized the type of brand promise made in campaigns where one was present. Most (89%) brand promises fit their definition of one or more of the following categories:

  • Emotional.

The researchers were surprised that a feel-good brand promise was the most popular category, with 35% assigned to this type. An emotional brand promise communicates the good feelings that will be experienced by customers who buy and use the product or service. A highly successful example of an emotional brand promise is the famous De Beers “A diamond is forever” marketing campaign brand promise that since 1947 has promised that the endurance of a diamond confirms the permanency and satisfaction of the marriage.

  • Functional

In 32% of the research sample, the brand promise stressed the reliability and functionality of the product or service. The FedEx “When it absolutely, positively has to be there overnight” campaign brand promise of 1978 was so powerful that it resulted in the creation of a new verb—to FedEx. The campaign’s brand promise can also be said to convey an emotional brand promise as well: customers don’t have to worry, because it’s FedEx.

  • Enjoyable to buy

Some companies (22%) took the unusual stance of portraying the enjoyment customers will experience as they shop for and buy a product or service. A good example an enjoyment-based brand promise is provided by the paint maker Sherwin-Williams; the company won the 2022 B2B Grand Prix at the prestigious Cannes Film Festival for its campaign based on an artificial intelligence tool that allows customers to create and choose a paint color by using voice to describe it (“a turquoise like the sea in the Maldives,” for example). Designers and architects swooned and prospective customers were convinced.

After the research team categorized the types of brand promises companies tend to make, they examined factors that make a brand promise strongly appealing to customers. Again, three features dominated successful campaigns:

  • Memorable

Surprisingly, making it known that a company is not the top seller in the marketplace can be highly persuasive. “We’re Avis and we try harder” was the slogan of the second-largest car rental company (after Hertz).  Within a year of its launch, Avis went from losing $3.2 million a year to earning $1.2 million a year. Advertising executives called the campaign the most brilliant of the 20th century.

  • Valuable

Customers must want what the brand promise offers, especially when the promise is communicated and perceived as an upgrade from circumstances that are perceived as unsatisfactory or lackluster. Prospective customers must feel that the value is relevant.

Deliverable

A defining characteristic of a brand promise is that it represents a guarantee; the customer must be able to recognize that the brand promise can be fulfilled and the benefits from its fulfillment will meet expectations. For that reason, making a brand promise is a risk. The research team’s assumption was that brand promises made campaigns were generally fulfilled, based on the success of the marketing campaigns studied.

Brand promise becomes strategy

The insight that effective brand building is anchored in a promise to the customer can do more for a company than just help it invest wisely in marketing. The promise can serve as the guiding principle of the marketing strategy, able to inform all promotional activities. A well-crafted and communicated brand promise is your North Star; creating and executing a brand promise is, the foundation of a strategy. From that brand promise/ strategy, you can understand how the company will beat its competitors, the value that customers see in your products and services, understand how the company position itself in the marketplace.

Below, Martin, Schwartz and Turner leave you with a five-step template that your company can use—a go-to-market brand promise development guide that also functions as the foundation of your marketing strategy. Furthermore, the study provides guidance about resources the company should dedicate to the various aspects of brand building, including which information sheds the most light on customer preferences, how to ensure that the most highly preferred aspects of the brand promise are delivered and how to effectively and efficiently communicating your brand promise.

  1. Step One is to understand customers well enough to know what constitutes memorability and value for them.

2. That understanding leads to Step Two, the development of a brand promise, expressed in a simple but compelling and memorable statement.

 3. In Step Three, your company publicly commits to the brand promise by launching the marketing campaign.

4. In Step Four, your company must communicate the brand promise to the target audience: If it isn’t received by way of the right channels, it can’t be effective.

5. Finally, in Step Five your company must fulfill the brand promise, or the promise will be largely worthless.

This cycle provides guidance about the resources the company must dedicate to the various aspects of brand building. How much should it dedicate to understanding customers? How much to designing and issuing a brand promise? How much to broadcasting and communicating it? And how much to ensuring that the key aspects of the brand promise are delivered? As the company repeats the cycle, it learns more about its strategic challenges and how to account for customer and competitor shifts.

The ultimate goal of a marketing campaign should be to go through the brand promise cycle often enough that your customers stop wondering whether you’ll make good on your promises. Once they assume that you will, they purchase out of habit rather than choice.

Thanks for reading,

Kim

Image: Photographed by James D. Love April 2021. William Hunn’s proposal to Brittney Miller included a helicopter ride over their home city of Atlanta, GA and Ms. Miller choosing one of the five engagement rings presented to her when she accepted his offer of marriage.